SEC calls for FG intervention on unclaimed dividend, inauguration of UDTF law

Nigerian Securities and Exchange Commission (SEC) has called on the Federal Government to inaugurate Unclaimed Dividend Trust Fund (UDTF) to deal with issues on unclaimed dividends. Mr Edosa Aigbekaen, Director, Legal Services and Secretary to the commission, made the call in Abuja. Aigbekaen said that the UDTF Bill, initially before the National Assembly, needed to be revisited to bring about sanity on the issue of unclaimed dividends in the nation’s bourse.

“Nigeria needs a law guiding how the national burse treats matters of unclaimed dividends, “ he said. Aigbekaen also called for the amendment of sections of the Companies and Allied Matters Act (CAMA) relating to the timeframe for unclaimed dividends to be reverted to originating companies. He said that investors should be able to claim their dividends at any given time, stressing that once dividends were declared, they remained debts owed investors. The secretary said that multiple applications for shares in the past, improper address of share holder and the inefficient postal system in Nigeria compounded the problem of unclaimed dividends.

He advised investors to embrace the e-dividend payment system to ensure payment of their dividends with 24 hours after they had been declared. Mr Ade Bajomo, Executive Director, Market Operations of the Nigerian Stock Exchange (NSE), said that NSE would soon issue a minimum registration requirement for all participants in the market. Bajomo said that the Exchange was working with the Central Securities and Clearing System to establish what should be the minimum requirement. He said: “the Exchange wants to move away from paper dividend”.

Mr Sola Ephraim-Oluwanuga, a legal practitioner, also supported the call for the establishment of UDTF. Ephraim-Oluwanuga said that revenue from the UDTF could be ploughed into critical areas of the nation’s economy. “The unclaimed dividends ought to serve our economic transformation agenda, “ he said. SEC had recommended the establishment of the UDTF in 2005. SEC has always proposed that the unclaimed dividends should be managed by an independent body.